Chartered Surveyors welcome new cost mitigation measures for State projects – but they say measures must be kept under review

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Chartered Surveyors welcome new cost mitigation measures for State projects – but they say measures must be kept under review

“Maintaining momentum on these projects is key to rapid restart once ban on construction is lifted"

The Society of Chartered Surveyors Ireland has welcomed the decision by the Government to cover the costs of maintaining construction sites, closed as a result of the coronavirus lockdown.

Minister for Finance, Paschal Donohoe announced that builders working on State-funded projects would be paid ‘agreed reasonable non-pay fixed costs’ from April 12th to May 4th, the day before the Government is due to review the lockdown.

SCSI President Johanna Gill said the cost mitigation package together with other measures such as continuing planning and preparation for Project Ireland 2040 developments, extending tender deadlines and pushing forward with pre-contract design work, sends a positive signal to the sector. But she said the measures must be kept under review.

These measures demonstrate the Government’s commitment to maintain and continue work on Project Ireland 2040. In the current situation there is a lot of uncertainty in the market and uncertainty is one of the greatest inhibitors of business, especially in construction. Maintaining momentum on these projects is key to a rapid restart once the ban on construction is lifted, so we welcome these measures. However, we are in the middle of an unprecedented crisis so they will have to be kept under review and must be seen as part of a sustained recovery plan for the sector.

Many construction businesses across Ireland are struggling to survive this crisis so the ex-gratia payments to contractors and reducing the payment periods through the introduction of sub-milestones will be beneficial and help consultancy businesses with their cashflow challenges.”

The SCSI had recently raised with Minister Donohoe the need for measures to mitigate the severe impact of the crisis and for clarity surrounding the future of state projects. The construction sector employs 150,000 people and the value of construction output last year was estimated to be €23bn. Ms Gill said the importance of planning for the recovery was critical.

After the financial crash we experienced first-hand the long-term consequences of not having a post-crisis plan in place. In the following years there was a massive loss of skills and capacity which we are still trying to overcome in housing and key infrastructure projects. Those challenges will still be with us in what will be a very difficult post-Covid-19 landscape, but we are committed to working with Government to ensure the future delivery of housing and infrastructure in the public interest” she concluded.

Article Published: 16/04/2020